Oregon Proposes Modest Increase in Workers’ Compensation Costs for 2027

Oregon employers could see a modest increase in workers’ compensation costs next year, although the average rate would remain among the lowest the state has recorded.

The Oregon Department of Consumer and Business Services announced that employers would pay an average of 92 cents per $100 of payroll for workers’ compensation coverage in 2027 under a newly released proposal. That is up from an average of 89 cents per $100 of payroll in 2026.

Despite the increase, the proposed 2027 rate would be the second lowest on record in Oregon.

For an employer with $100,000 in annual payroll, the statewide average change would represent an increase of approximately $30 per year. Actual premiums can vary considerably based on the type of business, payroll, claims history and the rates and expenses charged by an employer’s insurance company.

What Would Change in 2027

The pure premium is the base rate insurance companies use to determine how much employers must pay toward medical expenses and lost wages for employees injured on the job. It does not include an insurer’s administrative expenses or profit.

Although the pure premium rate would increase by an average of 2.1% next year, the state said it will have fallen by 36.5% between 2018 and 2027.

Oregon has recorded annual pure premium reductions in each of the past five years:

• 2026: 3.3% decrease
• 2025: 3.2% decrease
• 2024: 6.7% decrease
• 2023: 3.2% decrease
• 2022: 5.8% decrease

Increased Benefits for Injured Workers

State officials said the proposed increase is partly connected to changes approved through Senate Bill 1519 during the 2026 legislative session.

Beginning January 1, weekly wage-replacement benefits would increase for lower-wage employees with disabling workplace injury claims. The compensation rate for wages at or below 75% of Oregon’s average weekly wage would rise to 75%. The rate for wages above that threshold would be adjusted to 65%.

The changes are intended to provide greater support for lower-wage workers who are unable to work because of an on-the-job injury.

Long-term reductions in the number of claims involving time away from work have helped keep Oregon’s overall workers’ compensation costs low, according to the National Council on Compensation Insurance. Those reductions have helped offset rising medical costs, more expensive claims and increased worker benefits.

Employers May See Different Results

The proposed 2.1% pure premium increase is a statewide average and does not mean every Douglas County employer will receive the same adjustment.

An individual business could experience a larger increase, a smaller increase, no change or even a decrease. Factors affecting the final premium include:

• The employer’s industry and type of work
• Total payroll
• Workplace injury and claims history
• Insurance company expenses and profit factors
• Applicable discounts or experience modifications

The changes would take effect January 1, 2027, but employers would generally see them when their workers’ compensation policies renew during the year.

Additional Assessments

The premium assessment paid by employers would remain at 9.8% of workers’ compensation premiums. The rate has remained unchanged since 2022.

That assessment supports several state programs, including Oregon OSHA, the Workers’ Compensation Division, the Workers’ Compensation Board and offices that advocate for injured workers and small businesses.

The Workers’ Benefit Fund assessment would increase from 1.8 cents to 2.2 cents per hour worked. The fund supports return-to-work programs, permanently disabled workers and families of workers who die from occupational injuries or illnesses.

A new assessment created through House Bill 4027 would add 0.2 cents per hour worked to help fund the Oregon Bureau of Labor and Industries. Together, the Workers’ Benefit Fund and BOLI assessments would total 2.4 cents per hour. Employers and employees would split the cost.

Public Comment Accepted This Month

Public hearings on the proposed assessments are scheduled for Thursday, September 17. The premium assessment hearing begins at 3 p.m., followed by the Workers’ Benefit Fund assessment hearing at 4 p.m.

Written testimony will be accepted through 5 p.m. Thursday, September 24, and may be mailed to:

Director’s Office of DCBS
P.O. Box 14480
Salem, OR 97309-0405

Additional figures and historical comparisons are available through the state’s workers’ compensation cost summary and Oregon workers’ compensation cost charts.